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Free trade for Central Asia?: The Pioneer
New Delhi, Oct 20: The Beijing session of the Council of the Heads of Government of the Shanghai Cooperation Organisation (SCO) engendered an unexpected subject with regard to the globalisation of the world economy.
New Delhi, Oct 20: The Beijing session of the Council of the Heads of Government of the Shanghai Cooperation Organisation (SCO) engendered an unexpected subject with regard to the globalisation of the world economy. The history of the SCO dates back to the 1996 Shanghai meeting between the presidents of five countries: Russia, China, Tajikistan, Kazakhstan and Kyrgyzstan. At first, forums were annually held at the top-level to discuss security in the zone "between Russia and China"; that is, Central Asia, especially in connection with the threat emanating from Taliban-controlled Afghanistan. From the spring of 2001, the forum began turning into a full-fledged organisation. However, the economic component of the organisation's work was confined to the fact that poverty in Central Asia was a source of instability there and action had to be taken.
At present, the strategic aspect of the SCO has receded into the background, because the threat emanating from Afghanistan is no longer so urgent and the mechanisms for consultations between defence and intelligence agencies, just like the SCO anti-terrorist centre in Bishkek, have already become a reality. Consequently, "the economic" meetings between the premiers of the six SCO countries, which are held in autumn, have acquired importance, while the heads of state discuss military-political issues in late spring.
The premiers' late September meeting in Beijing sprang a surprise on everybody. Chinese premier Wen Jiabao put forward an initiative to create a free trade zone within the framework of the SCO. Only a year ago it was obvious that Beijing lacked ideas about the economic development of the territories to the west of China. It is beyond doubt that the point at issue is a new policy from the Chinese leaders, led by President Hu Jintao and premier Wen Jiabao.
Let us examine the nuances. Russian Prime Minister Mikhail Kasyanov said at the end of the Beijing meeting that the development of transport infrastructure, power engineering, environmental protection and especially the problem of drinking water would become the top priorities of SCO trade-economic cooperation. An important point is that these infrastructure projects are the necessary minimum under any models for the development of the situation in Central Asia.
The Chinese premier highlighted the same things in different words. He talked about ensuring infrastructure for trade and investment to guarantee stable goods' circulation within the SCO, about the need to lift non-tariff barriers which are imposed as a result of the actions of customs, quarantine and transport services. All this, in his words, are the conditions needed to create the free trade zone that China is proposing to form by 2020.
The long-term programme of trade-economic cooperation within the framework of the SCO, which was approved in Beijing, covers precisely this period, that is, until 2020. The heads of government will give the relevant economic agencies instructions to choose several projects, even if they are small, where the parametres and model of economic cooperation within the framework of the six can be tested.
In principle, free trade is the direction in which the whole world economic system is moving. It is another matter that universal liberalisation reminds one of a receding horizon, as the failure of the regular round of WTO negotiations held in Cancun (Mexico) showed. It failed because the interests of developed and developing countries are not the same. This is why the idea of creating regional free trade groups, each with it own specific features and pace of movement toward economic freedom, looks more realistic. They facilitate preparations for joining the WTO and, in general, for world integration.
Relations between Russia and China are very good politically. At the same time, there are problems in the economic sphere. The crux of these problems is the time of "bilateral" trade is passing away to be replaced by an era of general principles and rules. The transition to these may be painful. The joint projects of Moscow and Beijing gives them the chance to find many innovative solutions in regard to the economic development of this region, thereby bringing numerous benefits to the six SCO member-countries.
The premiers' late September meeting in Beijing sprang a surprise on everybody. Chinese premier Wen Jiabao put forward an initiative to create a free trade zone within the framework of the SCO. Only a year ago it was obvious that Beijing lacked ideas about the economic development of the territories to the west of China. It is beyond doubt that the point at issue is a new policy from the Chinese leaders, led by President Hu Jintao and premier Wen Jiabao.
Let us examine the nuances. Russian Prime Minister Mikhail Kasyanov said at the end of the Beijing meeting that the development of transport infrastructure, power engineering, environmental protection and especially the problem of drinking water would become the top priorities of SCO trade-economic cooperation. An important point is that these infrastructure projects are the necessary minimum under any models for the development of the situation in Central Asia.
The Chinese premier highlighted the same things in different words. He talked about ensuring infrastructure for trade and investment to guarantee stable goods' circulation within the SCO, about the need to lift non-tariff barriers which are imposed as a result of the actions of customs, quarantine and transport services. All this, in his words, are the conditions needed to create the free trade zone that China is proposing to form by 2020.
The long-term programme of trade-economic cooperation within the framework of the SCO, which was approved in Beijing, covers precisely this period, that is, until 2020. The heads of government will give the relevant economic agencies instructions to choose several projects, even if they are small, where the parametres and model of economic cooperation within the framework of the six can be tested.
In principle, free trade is the direction in which the whole world economic system is moving. It is another matter that universal liberalisation reminds one of a receding horizon, as the failure of the regular round of WTO negotiations held in Cancun (Mexico) showed. It failed because the interests of developed and developing countries are not the same. This is why the idea of creating regional free trade groups, each with it own specific features and pace of movement toward economic freedom, looks more realistic. They facilitate preparations for joining the WTO and, in general, for world integration.
Relations between Russia and China are very good politically. At the same time, there are problems in the economic sphere. The crux of these problems is the time of "bilateral" trade is passing away to be replaced by an era of general principles and rules. The transition to these may be painful. The joint projects of Moscow and Beijing gives them the chance to find many innovative solutions in regard to the economic development of this region, thereby bringing numerous benefits to the six SCO member-countries.